Beijing ‘should be wary’ as US and Taiwan seek closer economic ties

  • Beijing should be cautious about growing economic ties between Taipei and Washington, after Taiwanese and US officials wrapped up four days of trade talks in Taipei on 17 Jan, held under the new US-Taiwan initiative on 21st-century trade.
  • Both sides have indicated that they may reach agreement on issues such as trade facilitation and promotion of good regulatory practices.
  • The negotiations were an important part of efforts from both sides to reduce economic reliance on Beijing. The core of the initiative is to counter the mainland and establish a US-Taiwan economic cooperation system, and to include Taiwan in the US supply and industrial systems,
  • Positive results are hoped to be achieved in four key areas – trade facilitation, the promotion of small and medium-sized enterprises, good regulatory practices, and anti-corruption measures.
  • The negotiations are likely to drive more Taiwanese investment in the US, citing Taiwanese Semiconductor Manufacturing Company as an example. The chip giant last month increased its investment in a US plant to USD40bn.
  • Furthermore, the negotiations could drive other countries to follow suit by seeking similar deals with Taiwan, undermining Beijing’s efforts to promote its one-China message in the international community.

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